Fannie Mae Mgt. Shakeup; Oil Shrugs Off Gustav

After the bell, Fannie Mae was halted as it announced several management changes, including a new CFO (David Hisey, previously Sr. VP and Controller), Chief Risk Officer (Michael Shaw, formerly Sr. VP-Credit Risk Management), and Chief Business officer (Peter Niculescu, formerly Exec. VP of Capital Markets).

Note that there are no outsiders being brought in. They need to show that they are serious about the two most important issues: conserving capital and controlling credit losses.

The larger issue today: How serious is Gustav? Assuming a Category 3 hurricane in eastern Louisiana, RBC Capital today estimated it would involve a loss of production of 3 percent of total U.S. crude inventories and 2 percent of natural gas inventories. That is a fairly modest loss. Obviously, if the storm strengthens the damage could be more severe.